The new year sparked a rise in crypto buying sentiment, pushing the total market cap up by over 5% to $1.84 trillion, a level last seen in May 2022. This surge helped both BTC and ETH prices break through key resistance levels. Yet, there’s a risk of correction. On-chain data suggests that short-term buyers, currently sitting on high profits, might sell off at these higher levels, potentially creating selling pressure.
Ethereum’s Netflow Continues Its Surge
After hovering around a bearish consolidation range, Ethereum’s price finally achieved a breakthrough, surpassing the closely watched $2,400 level. This upward movement resulted in a total liquidation of $25.8 million, with sellers offloading more than $16.4 million in positions.
Yet, as Ethereum’s price rally paused above $2,430, a decrease in buying momentum was observed. This shift occurred as short-term buyers cashed in their positions, aiming to book maximum gains on the recent surge. Data from Coinglass indicates that approximately $9.4 million in long positions were liquidated during this period.
The potential for bearish momentum is growing, as indicated by a consistent rise in Netflow over the past week, based on data from IntoTheBlock. Following a dip to -111K ETH on December 26, there has been a notable shift with more Ethereum being moved to exchanges, as inflows began to exceed outflows.
Consequently, Netflow has moved into positive territory, currently at 45.5K ETH, following a boost in buyer confidence in ETH’s price. Typically, a rising Netflow signals bearishness, suggesting that the increased inflow of an asset to exchanges often signals its sale at or near market peaks.
The hourly long/short ratio is showing a bearish trend, having fallen below the 1.0 threshold and currently trading at 0.8769. This indicates that bears are in control, with approximately 53.2% of positions anticipating a decline in value. In contrast, only 46.7% of positions are expecting a price increase in ETH.
What’s Next For ETH Price?
Ether faced a rejection at $2,433 recently and is aiming to correct its price in the coming hours, indicating that bears are exerting pressure at higher levels. As of writing, ETH price trades at $2,370, surging over 2.9% from yesterday’s rate.
On the bullish side, the price has managed to stay above the 20-day Exponential Moving Average (EMA) at $2,333, bringing some hope. However, there’s a risk of increased selling if buyers fail to drive the price above the $2,500 soon.
Should the 20-day EMA be breached, ETH price could decline towards the ascending support line at $2,250.
Conversely, a successful break and close above the channel would signal that bulls are still in the game. In this scenario, buyers might attempt to push the price beyond $2,433-$2,500, aiming for an uptrend towards the $3,000 mark. With the RSI level now stabilizing, we might see a strong rebound from the EMA20 trend line.
>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : Coinpedia – https://coinpedia.org/price-analysis/ethereums-netflow-continues-to-surge-as-short-term-holders-exit-will-eth-price-hold-bullish-momentum/
